Observations on PayPal: your thoughts?

stratoskier · #1 02-28-2005, 05:10 PM

Hi,
Most of my auction dealings have been purchases rather than sales -- until recently. So I hadn't paid a lot of attention to the various PayPal options. Now that I'm selling some things, I just became aware of the difference between a "Premier" account and a regular "Personal" account. The Personal account type is free (that is, they don't take a percentage of your purchases when someone pays using a bank withdrawal), but your buyers can't use a credit card. A Premier account allows buyers to pay with a credit card, BUT the seller has to pay 2.9% on all payments that use a bank withdrawal.

This strikes me as a very strange system. If you only have a Personal account, your buyer can step through the PayPal payment process, and even give a credit card as the form of payment. But the seller will then get a notice saying: "Hey, guess what? Your buyer used a credit card, so now you gotta upgrade to a Premier account and start paying us 2.9% on all bank transfers! Na, na, na, na, na!!! Or you can decline the payment, get bad feedback, forfeit the sale, and you know, bad mojo..."

So you're pretty much stuck, and have to start paying 2.9% on the most common form of payment. And here's the other part that irks me -- if you (as the buyer) typically DO pay by bank transfer, but on one occasion try to pay using a credit card, you get a pleasant message from PayPal saying "Oh, you don't REALLY want to use a credit card, do you? It's not an instant payment, and blah, blah, blah..." So now I understand why they want you to instead pay using a bank transfer -- that's the only way they can collect the 2.9% (they don't take fees on credit card payments).

This is undoubtedly old information for you veteran sellers, but having just figured out how it works, I'm a little peeved. By the time you pay the listing, fees, and the PayPal costs, you've forfeited a fair amount of loot on pricier items.

Done ranting,
Bert

Rich · #2 02-28-2005, 05:15 PM

www.paypalsucks.com

**jemsite** · #3 02-28-2005, 05:21 PM

i don't see the room for complaints, given the fact the cost of running the business. they're essentially giving you the ability to accept credit card fees, and reduce losses for a percent less than many banks and cc verification.

ymmv... glen

Rich · #4 02-28-2005, 05:30 PM

Quote:

Originally Posted by jemsite

i don't see the room for complaints, given the fact the cost of running the business. they're essentially giving you the ability to accept credit card fees, and reduce losses for a percent less than many banks and cc verification.

ymmv... glen

Obviously sombody that's never investigated Paypal.

scanlan75018 · #5 02-28-2005, 05:48 PM

Ask Brent, we had some fun with paypal last year (they reversed a transaction 3 monthes after the payment, only because I was from europe and the account I used wat not certified).
I think what they do is not always legal, especially with reversed transactions...

But it's sometimes very useful for customers...

**jemsite** · #6 02-28-2005, 06:16 PM

was not certified

...glen

stratoskier · #7 02-28-2005, 06:19 PM

Glen,
I agree that they need to earn some income for the service they provide. What strikes me as very odd is that there is NO charge to a Personal account seller when someone pays with a bank withdrawal, but there is a 2.9% charge to holders of Premier accounts for the same service. Why would they do that, rather than charge a % on credit card transactions (as is the usual way that merchants pay for the ability to accept credit cards). See the Catch-22 here?

And then there is the fact that they discourage buyers from using a credit card with a silly warning message about non-instantaneous payment. I never understood why before (the reason is that almost all sellers have been compelled to upgrade to a Premier account, and they don't collect any fees if you pay with a credit card).

... hmm, I only thought I was done ranting

**jemsite** · #8 02-28-2005, 06:22 PM

the free service is to get you to try at no-risk then either buy in or stop using... glen

ScottB · #9 03-01-2005, 12:57 AM

I don't sell very much, but when I do, I specify that only Paypal bank transfers will be accepted. No credit cards. I've had a personal account since '99 and haven't been forced to upgrade yet.

hal james · #10 03-01-2005, 01:22 AM

paypal makes it near impossible to get a refund if you make a payment and don't receive your item after 30 days. The way to really tick them off is to do a credit card chargeback. Then Paypal is forced to check into the transaction (but not before they send you an angry email telling you to go thru them before you call your credit card company.) I wrote them and asked, how? You can't because they shut down the transaction after 30 days and you can't access their dispute/claim area. For buyers that get ripped thru paypal, a credit card chargeback is the way to go.

Rich · #11 03-01-2005, 01:24 AM

And when a seller gets ripped from paypal because they received a stolen credit card payment, paypal freezes your account and goes after the money from the bank account you have linked to your paypal account. And there's nothing you can do about it.

hal james · #12 03-01-2005, 01:48 AM

thats why I don't get "verified"

scanlan75018 · #13 03-01-2005, 05:44 AM

Quote:

Originally Posted by jemsite

was not certified

...glen

But it was not necessary for such a low amount when I did the transaction...
The rules changed afterwards.

It's not legal in my opinion to reverse a transaction 3 monthes after the deal has been done... only because general rules had changed during this period.
Luckily for brent I was honest enough to send him the money again...
But i don't really know what he could have done to find me again if i had changed my email adress or if i didn't want to pay...

fettouhi · #14 03-01-2005, 10:18 AM

Quote:

Originally Posted by Rich

www.paypalsucks.com

Regards

André

kennydoe · #15 03-01-2005, 10:32 AM

e*bay's customer service isn't much better. I have had a compliant about a deadbeat bidder in the works for months, but they haven't gotten rid of the charges for the sale, and they keep hounding me for the money. And I can't seem to find a list of itemized charges on my invoice.

As for Paypal, I've gotten to the point where I just state in my auctions that if you want to use it, you pay the fees. Between the e*bay listing fee, the final value fee and the paypal fee, it's hard to break even anymore.